Former President Donald Trump has recently ramped up his criticism of President Biden and Vice President Kamala Harris, claiming inflation has caused severe financial strain for American families.
During a Sept. 13 rally in Las Vegas, Trump asserted that “the worst inflation in American history” has cost the average American household a whopping $28,000. He repeated the figure at rallies in Wisconsin, Pennsylvania and Arizona, raising eyebrows and fueling debate.
But is Trump's claim accurate? Economists and analysts have weighed in, providing some clarity on the matter.
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It's true that under President Biden, inflation reached its highest level in decades, peaking at 9.1% in June 2022. However, inflation has since moderated, falling to 2.5% in August 2024, the lowest rate in three years. While the rate of price increases has slowed, prices themselves haven't come down.
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As CBS News reports, the cost of household essentials remains elevated compared to pre-pandemic times.
So, where did Trump get that figure of $28,000? According to economists, the number holds some truth, but there's more to the story. It aligns closely with an estimate from Republicans on Congress' Joint Economic Committee. Based on data from the Bureau of Economic Analysis, their tracker follows personal consumption expenditures at the state level.
Since January 2021, the study monitored the monthly expenses of an average American household across all states. By July 2024, the cumulative increase in household costs, fueled by inflation, reached an average of $27,950 for households in all 50 states and Washington, D.C.
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These numbers reflect cumulative cost increases over three and a half years. But it's important to note that while expenses have surged, so have incomes. Many households have seen wage growth partially offset inflation's sting.
Economists interviewed by CBS News confirmed that the $28,000 estimate is mostly accurate, but they caution against focusing solely on price hikes without considering income growth.
There's no denying that inflation has made life more expensive for most Americans. But how does the Biden administration compare to the Trump era in this regard? According to government data, prices rose under Trump too, though to a lesser extent.
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During his four years in office, the Consumer Price Index (CPI) for all items rose by about 8%. By contrast, consumer prices have surged by roughly 20% since Biden took office. The difference is stark, but so are the circumstances each president faced. Trump's administration benefited from low inflation and strong job growth for much of his term.
However, the COVID-19 pandemic disrupted the economy in his final year. When Biden took office, the economy was recovering, with inflation spiking due to supply chain disruptions and surging demand.
Many countries worldwide experienced similar inflation spikes during this period, with some exceeding U.S. levels. Inflation is a normal part of a growing economy and the Federal Reserve aims to keep it around 2% annually. Deflation or falling prices, is typically viewed as harmful by economists.
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This article Trump Claims Inflation Has Cost American Households $28,000 – Is He Right? Here's What Financial Experts And Analysts Are Saying originally appeared on Benzinga.com
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